Shares in UK Coal fell 34pc yesterday after it warned profits would be "significantly
below" expectations, just seven weeks after it announced it was
confident of meeting targets.

The company said the falling price of coal and lower-than-expected output because of poor weather and "difficult geological conditions" at its Kellingley and Thoresby deep mines were behind the news. Prices of commodities have fallen around the world in the last few weeks as fears of a global recession have increased. In an interim management statement, UK Coal said full-year sales should now total 8m tonnes rather than 8.7m tonnes and the fall in the price of coal meant that the shortfall would now not be offset.

UK Coal

Analysts expressed disappointment at the update by UK Coal, which has a growing property portfolio, with Numis Securities more than halving 2008 pre-tax profit forecasts from £67.9m to £30m. In 2007, UK Coal reported profits of £69m.